China’s Rich List: Retail Trumps Real Estate

The country, excluding Hong Kong and Taiwan, is home to the largest population of billionaires on Earth, surpassing the 403 billionaires in the U.S., according to a new ranking of China’s richest from Hurun Report, a Shanghai-based group that follows China’s wealth trends.

The exact number of China’s billionaires is hard to come by, says Rupert Hoogewerf, founder of Hurun. “We already know of 189 US dollar billionaires in China this year,” he says, “but you can safely say that we have missed at least the same again, meaning there are between 400 and 500 USD billionaires today.”

Fuzzy math aside, there are almost certainly more billionaires in China than care to admit it. Many wealthy Chinese people either earn money under the table or stash it away to avoid paying taxes, making wealth determination difficult (for more on that, see today’s Heard on the Street column ). But a look at some of the top billionaires who have made their wealth known sheds light on growing domestic demand and offers hints about China’s economic future.

Take Zong Qinghou, the 65-year-old chairman of the China’s leading beverage company Hangzhou Wahaha Group, who rode the country’s thirst for bottled water, fruit juice and milk-tea to $12 billion in total assets and the top spot on Hurun’s list – up from number 12 last year. Domestic demand for food and beverages gave rise to four others who ranked in the country’s top 100 billionaires, including fifth richest Yan Bin, who owns the rights to sell energy drink Red Bull in China.

The food-and-beverage crowd aren’t the only ones prospering from the rise of the Chinese shopper. Of the 1,365 Chinese individuals worth over $150 million, Hurun says 95% earned their riches on the backs of domestic consumers.

Fatter wallets have also given the Chinese the chance to buy more clothing, helping to increase the wealth of apparel makers, such as Zhou Chengjian, founder of clothing retailer Metersbrowne, who hit number 25 with $3.5 billion, and Ding Shizhong, chairman of sporting goods company Anta, whose $3.1 billion put him at 37th.

Sellers of big-ticket items haven’t fared as well. Due to recent government attempts to cool off the housing market, particularly in Beijing and Shanghai, this year marks the first time a real estate tycoon hasn’t topped Hurun’s rankings. The government effort’s helped bump four tycoons from last year’s top ten, leaving only two behind: Wang Jianlin ($5 billion), chairman of developer Dalian Wanda Group, and Xu Rongmao ($4.9 billion), who leads Shanghai-based Shimao and has consistently counted as one of China’s top ten richest for the past decade.

That doesn’t mean the age of property barons is over, however. While real estate magnates may no longer dominate the top ten, property remains China’s biggest wealth creator, paving the way for 36 of the country’s (identified) billionaires.